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THE MANAGEMENT BIBLE
infrequent and occur too far from the action they are evaluating to have any meaning. In the end, employees are often demotivated by the appraisal process. For their part, many managers dread giving appraisals and, given the choice, would (and do) skip the process altogether. In fact, some 40 percent of employees report not even receiving an annual performance review.
WHY EVALUATE PERFORMANCE? Despite these failings, most agree that—when managed correctly— there are many valid reasons to have a performance appraisal system. An objective appraisal process focuses on employee job performance toward agreed on goals, not personality traits. It recognizes the employees’ contributions toward achieving organizational goals, addresses shortcomings, identifies education needs, and is a meaningful part of a person’s career planning process. For most organizations, this process is also the basis for employee compensation. The appraisal process also helps companies make decisions about promotability, training and staffing needs, and salary and compensation benefits. And, there are many legal reasons for a well-designed, well-implemented appraisal program, including its use as legal documentation in the event of an employee termination. However, performance appraisal programs continue to receive a lot of attention in the courts, particularly in how they impact employment for protected employee groups. The legal implications for companies without a welldefined appraisal program are serious. Recent court decisions indicate that a successfully defended appraisal program includes the following: • •
Specific instructions and training were given to supervisors on how to complete the appraisals. Job content was used to develop the basis of the appraisal.
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